Ann: Annual Report to shareholders , page-6

Although it is his job to promote the company RC sums progress up perfectly in his statement.

When Niobrara, EFS (and Austin Chalk) come on line we will have oil and gas cash-flow, prospects will become reserves and future growth will be funded from cash-flow and debt financing.

"In February and March of 2012 the Company was able to raise approximately $25 million in capital in an extraordinarily difficult market. That is sufficient to meet its tenement commitments in the exciting Niobrara and Eagle Ford shale plays. Additionally, with prudent management we expect to increase production to a stage where during this forthcoming year, we become self-funding. The $25 million may become the veritable Magic Pudding.

With this goal in mind, the board endorsed the "500 squared" programme whereby $500,000 of costs were targeted to be taken out of the company's cost base by 31 December 2012 (money that could be redirected towards drilling) and 500 BOPD of production was targeted to be obtained by first half of calendar year 2013. I am pleased to report that the first objective has been exceeded by nearly a factor of 2, with close to $1,000,000 taken out to date. With the discovery at Mississippi and the production from Kentucky, more than 25% of the second target has been achieved before the results of Niobrara and the Eagle Ford are factored in.

I feel privileged to be chairman of this company and able to work with Dr Mark Hart, a man whom I respect for both his integrity and his technical ability. For a company the size of Austin to have such technical depth in its employees is truly amazing. I am also delighted to be working alongside Nigel Hartley, whose strong financial experience with Oil Search augments the talent of this board in knowing the ropes of how to grow a company. The board is acting as a team united in its mission of creating shareholder wealth.

We are confident that in the coming year shareholders will be able to harvest some of the fruits of this year's hard work. An early start has been made with significant hydrocarbons discovered at flagship properties in Colorado and Texas, and Independent consultant Gustavson Associates confirming the potential of these projects."